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HomeMy WebLinkAboutProp 218 - Zone 8 Palm Gate LLD No. 1 FY 18-19 RESOLUTION NO.2018-10 STAFF REPORT CITY OF PALM DESERT PUBLIC WORKS DEPARTMENT MEETING DATE: February 8, 2018 PREPARED BY: Randy Chavez, Landscape Supervisor REQUEST: Public Hearing to Tabulate Proposition 218 Ballots and Consideration of the Corresponding Resolution Confirming the Diagrams and New Increased Assessment Proposed for Zone 8, Palm Gate, of the City of Palm Desert Landscaping and Lighting District No. 1 for Fiscal Year 2018-19. Recommendation By Minute Motion: 1. Conduct the Public Hearing upon the proposed increased assessments and consider all objections and protests, whether written or oral, if any; 2. Continue the Public Hearing and direct staff to tabulate the Proposition 218 Ballots for Zone 8, Palm Gate, of the Landscaping and Lighting Maintenance District No. 1, and continue the agenda item until later in the meeting, at a time determined by the City Council, to allow for tabulation and reporting of results; and 3. Recommence the Public Hearing at a subsequent time during the meeting, and take the following action: a. Adopt RESOLUTION NO. 2018-10 , A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, PURSUANT TO THE PROVISIONS OF THE LANDSCAPING AND LIGHTING ACT OF 1972, CONFIRMING THE DIAGRAM AND ASSESSMENTS FOR FISCAL YEAR 2018-2019 FOR THE LEVY OF PROPOSED INCREASED ASSESSMENTS FOR ZONE 8, PALM GATE, WITHIN LANDSCAPING AND LIGHTING DISTRICT NO. 1, OVERRULING ALL PROTESTS CONCERNING THE ASSESSMENTS, AND LEVYING THE ASSESSMENTS CONFIRMED HEREIN. Strategic Plan This is an operational function and, as such, does not impact the goals of the Strategic Plan. February 8, 2018 - Staff Report Palm Gate Assessment Levy and Approval to Ballot Page 2 of 3 Executive Summary A Public Hearing will be conducted for the proposed assessment increase for Zone 8, Palm Gate, to officially count the ballots, allow public testimony, and order the levy and collection of assessments for Fiscal Year 2018-2019. Adopt the Resolution for the proposed increased assessment for Zone 8, Palm Gate, of the City of Palm Desert Landscaping and Lighting District No. 1. Background On December 14, 2017, the City Council adopted Resolution No. 2017-81, initiating proceedings to levy proposed increased assessments within the Landscaping and Lighting District No. 1 for Zone 8, Palm Gate, which current maximum assessments are insufficient to fund maintenance services at an optimal level and also ordering the Engineer to prepare and file a report for said Zone in accordance with Article 4 of Chapter 1 of the Landscaping and Lighting Act of 1972 (the Act). At that same December 14, 2017 City Council meeting, the Council adopted Resolution No. 2017-82 approving the Engineer's Report and Resolution No. 2017-83 declaring its intention to ballot property owners for proposed increased assessments within Zone 8 for the 2018-2019 Fiscal Year, setting a time and place for a Public Hearing on February 8, 2018, and authorizing staff to proceed with the balloting procedures. At the public hearing, ballots will be opened and counted. The public hearing will allow public testimony; and if there is consensus to increase the annual assessment levy, the increase in the levy and collection of assessments for Fiscal Year 2018-19 will be approved. The new annual assessment levy will be placed upon each parcel beginning in Fiscal Year 2018-2019, as outlined in the attached Engineer's Report. Discussion Public Hearing and Proposition 218 Balloting Notices and Proposition 218 ballots were mailed to the property owners, listed on the current County of Riverside Secured roll, pursuant to the regulations governing majority protest votes. This Public Hearing is being held not less than 45 days after the mailing of the requisite notices, as required by Proposition 218. As of the date of drafting this report, a total of nine ballots from the thirty-seven ballots mailed have been received. Property owners have until the close of the Public Hearing to submit a signed and marked assessment ballot. Ballots that were received by the City Clerk by U.S. Mail, or otherwise delivered to the City Clerk before the Public Hearing, or received during the Public Hearing itself, shall be counted, if properly completed and executed. During the Public Hearing, the City Council shall consider all objections or protests, if February 8, 2018 - Staff Report Palm Gate Assessment Levy and Approval to Ballot Page 3 of 3 any, to the proposed assessments, whether oral or written. Upon close of the Public Hearing, Proposition 218 ballots received will be opened and tabulated, consistent with all applicable procedures required by Proposition 218 and its implementing statutes, weighted by the proposed assessment amount on each property, and the results announced. All returned ballots will remain unopened and in the charge of the City Clerk until the close of the public hearing and direction to staff to tabulate the ballots. For purposes of tabulation, all of the returned ballots submitted, and not withdrawn, will be tabulated and weighted according to the financial obligation of each particular parcel. Article XIIID of the California Constitution provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to increase the assessments as proposed. A majority protest exists if the assessment ballots submitted, and not withdrawn, in opposition exceed the assessment ballots submitted, and not withdrawn, in favor, weighting those assessment ballots by the amount of the proposed assessment to be imposed upon the identified parcel for which each assessment ballot was submitted. If there is no Majority Protest, as described above, the City Council may approve the proposed increase by adopting the resolution attached to this Staff Report. Any voter approved increased assessment will be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2018-2019. If a Majority Protest does exist, the assessment shall remain at their current maximum amount for FY 2018-2019. Fiscal Analysis There is no fiscal impact beyond the loan from the City's General Fund to Palm Gate, which will be reimbursed from the annual assessment levy over a 15-year period. LEGAL REVIEW DEPT. REVIEW FINANCIAL REVIEW CITY MANAGER 4- N/A rt4044\‘‘ Ya `Robert W. Hargreaves `.. Si othyll. asson .tan Moore Lauri Aylaian City Attorney IndependenInterim Director of Finance City Manager Director of Public Works ATTACHMENTS: Resolution No. 2018- 10 Engineer's Report Vicinity Map RESOLUTION NO. 2018-10 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, PURSUANT TO THE PROVISIONS OF THE LANDSCAPING AND LIGHTING ACT OF 1972, CONFIRMING THE DIAGRAM AND ASSESSMENTS FOR FISCAL YEAR 2018/2019 FOR THE LEVY OF PROPOSED INCREASED ASSESSMENTS FOR ZONE 8, PALM GATE, WITHIN LANDSCAPING AND LIGHTING MAINTENANCE DISTRICT NO. 1, OVERRULING ALL PROTESTS CONCERNING THE ASSESSMENTS, AND LEVYING THE ASSESSMENTS CONFIRMED HEREIN WHEREAS, Resolution 2017-81 of the City Council of the City of Palm Desert initiated proceedings to levy proposed increased assessments for the City of Palm Desert Landscaping and Lighting Maintenance District No. 1 (the "District") for Zone 8, Palm Gate; and WHEREAS, Resolution 2017-81 also ordered the preparation of an Engineer's Report required by Streets and Highways Code Section 22622; and WHEREAS, after fully considering the Engineer's Report,the City Council adopted Resolution No. 2017-82 approving the Engineer's Report for the balloting of proposed increased assessments; and WHEREAS, by Resolution No. 2017-83, the City Council declared its intention to ballot property owners for proposed increased assessments for Zone 8, Palm Gate, in Landscaping and Lighting District No. 1, in accordance with Proposition 218, and provide notice pursuant to applicable law of a Public Hearing of the City Council on the matter, and set the Public Hearing for February 8, 2018 at 4:00 p.m. and authorized the proceedings for a Proposition 218 ballot; and WHEREAS, Proposition 218 ballots and Notices were mailed to the property owners in Zone 8, Palm Gate, pursuant to the applicable laws and regulations governing majority protest proceedings, including but not limited to Article XIIID of the California Constitution and Government Code §§ 53750 et seq.; and WHEREAS, the City Clerk caused Notice of the Public Hearing to be given in the manner provided by applicable law; and WHEREAS, on February 8, 2018, the City Council held a duly noticed Public Hearing not less than 45 days after the mailing of the Proposition 218 ballots and notices to consider all oral statements and all written protests, objections, and communication made or filed by any interested person, and receipt of Proposition 218 protest ballots; and WHEREAS, the City Council considered all public testimony presented at the Public Hearing, received and considered all written protests and evidence presented or filed at said Hearing, and at the conclusion of the Public Hearing the City Clerk or designee tabulated the valid protest ballots returned regarding the proposed increased assessments; and WHEREAS, the returned ballots for Zone 8, Palm Gate, were opened and tabulated and majority protest, as outlined in Article XIIID of the California Constitution, existed (or did not exist) as shown herein: RESOLUTION NO. 2018-10 Total Ballot Amount Submitted in Favor $ Total Ballot Amount Submitted in Protest $ No Majority Protest Majority Protest (Levy at Increased (Levy at Current Assessment) Approved Assessment) ❑ ❑ ; and NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm Desert as follows: SECTION 1. The foregoing recitals are incorporated herein by this reference. SECTION 2. Proposition 218 ballots for Zone 8, Palm Gate,were tabulated and a Majority Protest existed (or did not exist) as checked above. The City Council hereby overrules all protests presented concerning the annual assessments for Zone 8, Palm Gate, in Landscaping and Lighting District No. 1 for Fiscal Year 2018-2019. SECTION 3. Pursuant to Streets and Highways Code Section 22631, the City Council hereby confirms the diagram and assessments for Zone 8, Palm Gate, as checked above that are within the Palm Desert Landscaping and Lighting Maintenance District No. 1 for Fiscal Year 2018-2019 as outlined in the Engineer's Report previously approved by Council. SECTION 4. Passage of this Resolution shall constitute the establishment of the current or increased assessments for Fiscal Year 2018-2019 for the Zone 8, Palm Gate, as checked above. A copy of the assessments which specifies the amounts levied is on file in the Office of the City Clerk, and is incorporated herein and made a part hereof as though fully set forth. SECTION 5. The City Council finds that the assessment for Zone 8, Palm Gate, checked above is in compliance with the provision of the Landscaping and Lighting Act of 1972 and Article XIIID of the California Constitution, and that the City Council has complied with all laws pertaining to the levy of an increased annual assessment. SECTION 6. If majority protest does not exist,the City Council orders the landscaping and lighting services be prepared for Zone 8, Palm Gate, of the District in accordance with said Engineer's Report and these proceedings. SECTION 7. The City Engineer is hereby authorized to update the Annual Engineer's Report and assessments for the Palm Desert Landscaping and Lighting Maintenance District No. 1 to reflect the improvements and assessments approved herein for the balloted Zone 8, Palm Gate, as checked above. SECTION 8. Pursuant to applicable law, the City Clerk is hereby authorized and directed to file a certified copy of this Resolution, and the diagram and assessments confirmed by this Resolution as may be required with the County Auditor/Controller and/or County Assessor of the County of Riverside if such documents are required in addition to those submitted for the annual levy of RESOLUTION NO. 2018-10 assessments for Zone 8, Palm Gate, of the Palm Desert Landscaping and Lighting Maintenance District No. 1 for Fiscal Year 2018-2019. PASSED, APPROVED, AND ADOPTED THIS DAY OF , 2018. STATE OF CALIFORNIA) COUNTY OF RIVERSIDE) ss. CITY OF PALM DESERT) Sabby Jonathan, Mayor City of Palm Desert, California I, ,City Clerk of the City of Palm Desert,County of Riverside, State of California do hereby certify that the foregoing Resolution No. was regularly adopted by the City Council of said City of Palm Desert at a regular meeting of said Council held on the day of , 2018, by the following vote: AYES: NOES: ABSENT: ABSTAINED: Rachelle D. Klassen, City Clerk City of Palm Desert Fi' .i !er y f_ ,' AI � ,' City of Palm Desert Palm Desert Landscaping and Lighting District No. 1 Engineer's Report Establishment of New/Increased Assessments Local Landscaping Zone 8, Palm Gate * 4 Fiscal Year 2017/2018 Intent Meeting: December 14, 2017 Public Hearing: February 8, 2018 27368 Via Industria Suite 200 October 2017 n` Temecula,CA 92590 Prepared By T951.587.3500 1800.755.6864 Willdan Financial Services N. F 951.587.3510 www.willdan.com/financial WWI LLDAN Financial Services ENGINEER'S REPORT AFFIDAVIT Palm Desert Landscaping and Lighting District No. 1 For Establishment of New/Increased Assessments Local Landscaping Zone 8, Palm Gate City of Palm Desert Riverside County, State of California This Report and the enclosed budget, diagram and descriptions outline the new or increased ("new/increased") assessments proposed to be levied for Local Landscaping Zone 8, Palm Gate within the Palm Desert Landscape and Lighting District No. 1 in the City of Palm Desert commencing in fiscal year 2018/2019. The proposed new/increased assessment is deemed necessary to adequately maintain the improvements in the Zone. The boundaries of Local Landscaping Zone 8, Palm Gate include each lot, parcel, and subdivision of land that will receive a special benefit from the proposed improvements to be provided, as the same existed at the time of the passage of the Resolution of Intention and described herein. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within Local Landscaping Zone 8, Palm Gate. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2017. Willdan Financial Services Assessment Engineer On Behalf of the City of Palm Desert By: — —Stacee Reynolds, Senior Project Manager By: Richard Kopecky R. C. E. # 16742 TABLE OF CONTENTS INTRODUCTION 1 Ballot Proceedings 2 Part l 3 Part II 3 Part III 4 Part IV 4 Part V 4 PART I — PLANS AND SPECIFICATIONS 5 District Overview 5 Local Landscaping Zones 7 PART II — METHOD OF APPORTIONMENT 8 Proposition 218 Benefit Analysis 8 Assessment Methodology 10 PART III —PROPOSED ZONE BUDGET 13 PART IV—ASSESSMENT ROLL 14 PART V—ZONE DIAGRAM 16 INTRODUCTION The City of Palm Desert (the "City"), under the provisions of the Landscape and Lighting Act of 1972, Part 2 of Division 15 of the California Streets and Highways Code (the "1972 Act") and the provisions of the California Constitution Article XIII D (the "Constitution"), annually levies and collects special assessments for the City's maintenance assessment district designated as: Palm Desert Landscape and Lighting District (the "District") in order to provide and maintain various landscaping and lighting improvements throughout the City that provide special benefits to properties within the City. This Engineer's Report (the "Report") has been prepared pursuant to Chapter 1, Article 4 and Chapter 3 of the 1972 Act, and presented to the City Council for their consideration and approval of the improvements and services to be provided within the local landscaping and lighting zone of benefit ("Zone) identified as Zone 8, Palm Gate ("Zone 8"); and the levy and collection of the proposed new/increased annual assessments related thereto to fund the costs and expenses required to service and maintain designated improvement areas within the Zone that provide special benefits to those parcels commencing in fiscal year 2018/2019. Annually, the City establishes the District's assessments for each Zone based on the special benefits received by the properties in that Zone and the associated net Total Eligible Special Benefit Expenses resulting from an estimate of the costs to maintain, operate and service the improvements in those Zones in conjunction with available revenues including fund balances, general benefit contributions, additional City contributions, and current assessment limits. In recent fiscal years, the additional proceeds that can be collected for reserve and capital improvement have been at a minimal or non-existing due to rising cost of general maintenance. As a result, budget adjustments have been made that may have included eliminating or reducing the amount being collected for capital improvement projects and/or operational reserves, and at the discretion of the City Council, implementing service reductions or temporarily providing additional City funding to support the improvements. In fiscal years 2004/2005 and 2008/2009 the City Council proposed new/increased assessments for Zone 8, to address the estimated special benefit improvement costs associated with the landscape improvement areas being maintained within the Zone at that time. Following the public hearings, ballots for the proposed new/increased assessments were tabulated and a majority protest existed, so the proposed new/increased assessments were abandoned and not imposed. Recently City staff has worked with a number of property owners in Zone 8 to identify the key improvements within the Zone that the property owners would be willing to pay an assessment for. After meeting the property owners, it was decided that the property owners would more than likely pay for an integrated service level which would be a step below the standard service level. Initially, after the balloting failed in fiscal year 2008/2009 the City reduced the overall maintenance level for the Zone, this reduction in service level took away the ability to collect for any renovations or replacement services for the Zone. To fully fund the designated landscape and lighting improvements that are considered special benefits to properties in Zone 8, the City has determined that it is appropriate and in the public's best interest to propose new/increased assessments that address the estimated special benefit improvement costs associated with these Zone improvements including, but not limited to the estimated expenditures for regular annual maintenance and repairs; incidental expenditures Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 1 related to the operation and administration of the District and Zone; and the collection of funds for operational reserves and/or for periodic maintenance and improvement rehabilitation projects as authorized by the 1972 Act. This Report outlines the improvements, and the proposed assessments to be levied for the special benefits the properties will receive from the maintenance and servicing of the landscaping and lighting improvements within Zone 8, Palm Gate for fiscal year 2018/2019. The annual assessments (new/increased assessments) proposed to be levied on properties within the Zone as described herein will provide a funding source for the continued operation and maintenance of landscaping improvements that provide special benefits to the properties within the Zone. The City will also loaned the Zone $40,000 for renovation and upgrade of the existing landscape improvements in fiscal year 2017/2018. The net annual cost to provide the improvements in Zone 8 is based on the various improvements and the types of improvements and services to be provided by the District for the properties that are directly associated with and benefit from those improvements and the net cost of providing those improvements and services are allocated to the benefiting properties within the Zone using a weighted method of apportionment (refer to Assessment Methodology in Section II, Method of Apportionment) that calculates the proportional special benefit and assessment for each parcel as compared to other properties that benefit from the District improvements and services. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the Riverside County Assessor's Office. The Riverside County Auditor/Controller uses Assessment Numbers and specific Fund Numbers, to identify on the tax roll, properties assessed for special district benefit assessments. Each parcel within a Zone is assessed proportionately for only those improvements provided in that Zone from which the parcel receives special benefit. If any section, subsection, sentence, clause, phrase, portion, zone, or subzone of this Engineer's Report is, for any reason, held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining provisions of the Engineer's Report and each section, subsection, subdivision, sentence, clause, phrase, portion, zone, or subzone thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, portions, zones, or subzones might subsequently be declared invalid or unconstitutional. Ballot Proceedings Pursuant to the provisions of Article XIIID, Section 4 of the California Constitution, the City shall conduct a property owner protest ballot proceeding (referred to as "Ballot Proceeding") for the proposed levy of new or increased assessments as described in this Report. In conjunction with this Ballot Proceeding, the City Council will conduct a noticed public hearing to consider public testimonies, comments and written protests regarding the levy of the proposed new/increased assessments. Upon conclusion of the public hearing, property owner protest ballots received will be opened and tabulated to determine whether majority protest exists: "A majority protest exists if, upon the conclusion of the hearing, ballots submitted in opposition to the assessment exceed the ballots submitted in favor of the assessment. In tabulating the Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 2 ballots, the ballots shall be weighted according to the proportional financial obligation of the affected property." After completion of the ballot tabulation, the City Council will confirm the results of the balloting. If majority protest exists for the proposed new/increased Zone assessment, further proceedings to implement the proposed new/increased assessment shall be abandoned at this time. However, the City Council may continue to levy and collect annual assessments for the improvements provided in the Zone at an assessment rate less than or equal to the previously approved maximum assessment rate (including the inflationary adjustment) adopted by the City Council. If tabulation of the ballots indicate that majority protest does not exist for the proposed new/increased assessments and the assessment range formula presented and described herein, the City Council may adopt this Report (as submitted or amended), approve the assessment diagram, and confirm the new/increased assessments as presented herein. In such case, the assessments as approved shall by reference be made part of and incorporated into the "Engineer's Annual Report Fiscal Year 2018/2019" for the District and the assessments for these properties shall be submitted to the Riverside County Auditor/Controller for inclusion on the property tax roll for each affected parcel. Report Content This Report consists of five (5) parts: Part I Plans and Specifications: This section provides an overall description of Local Landscaping and Streetlighting Zone 8 and the improvements for which parcels are assessed. The proposed new/increased assessments as outlined in this Report are based on the local landscaping improvements and appurtenant facilities that provide a special benefit to the properties within this Zone and operational expenses authorized pursuant to the 1972 Act. The plans and specifications contained in this section of the Report describe the overall nature and extent of the improvements. In conjunction with these descriptions of the improvements a visual depiction of the landscape improvement areas is provided on the Zone Diagram contained in Part V of this Report and Appendix A attached to this Report provides a more detailed description of the improvement areas. More detailed information regarding the specific plans and specifications associated with the Zone are on file in the Public Works Department and by reference are made part of this Report. Part II Method of Apportionment: This section includes a discussion of the general and special benefits associated with the various improvements to be provided within Zone 8 (Benefit Analysis), which includes a discussion of the proportional costs of the special benefits and a separation of costs considered to be of general benefit (and therefore not assessed). This section of the Report also outlines the method of calculating each property's proportional special benefit necessary to calculate the property's annual assessment. This method of apportionment is consistent with the previously adopted method of apportionment outlined in the Consolidated Annual Engineer's Report. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 3 Part III Proposed Zone Budget: An estimate of the annual costs to operate, maintain, and service the local improvements and appurtenant facilities within Zone 8. The budget for Zone 8 includes an estimate of the maintenance costs and incidental expenses including, but not limited to: labor, materials, utilities, equipment, and administration expenses as well as the collection of other appropriate funding authorized by the 1972 Act and deemed necessary to fully support the improvements. Those improvements and/or costs determined to be of general benefit shall be funded by a City contribution. While not shown as a budgeted expenditure at this time, if the proposed assessments are approved, the City Council at their discretion may provide a temporary advanced (loan) to fund and expedite various capital improvement projects (repair and rehabilitation of the improvements) within the Zone. Such loans will be paid back over time by the assessments utilizing the funds being collected for CIP and Rehabilitation Funding and/or Operational Reserves. Ultimately, City staff shall make the determination of which improvements, and the extent of the services and activities that shall be provided based on available revenues. Part IV Assessment Roll: The Assessment Roll contains a listing of all Assessor Parcel Numbers of the properties within Zone 8 and each parcel's corresponding "Balloted Maximum Assessment" and "Proposed Assessment FY 2018/2019". The proposed assessment amounts balloted and to be levied and collected in fiscal year 2018/2019 for each parcel is based on the parcel's calculated proportional special benefit as outlined in the Method of Apportionment (Part II of this Report) and the annual assessment rate established by the estimated Zone Budget (Part III of this Report). Part V Zone Diagram: This section of the Report contains a diagram showing the boundaries of Zone 8 for fiscal year 2018/2019 which incorporate the parcels determined to receive special benefits from the various District improvements. This diagram also provides a visual depiction of the location of the landscaped areas being maintained. Parcel identification, the lines and dimensions of each lot, parcel and subdivision of land within Zone 8 are shown on the Orange County Assessor's Parcel Maps, and shall include any subsequent lot line adjustments or parcel changes therein. Reference is hereby made to the Orange County Assessor's Parcel Maps for a detailed description of the lines and dimensions of each lot and parcel of land within Zone 8. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 4 PART I - PLANS AND SPECIFICATIONS District Overview The territory within the District consists of lots or parcels of land within the City of Palm Desert and the boundaries of the District. The purpose of this District is to provide in part through annual assessments, funding for the ongoing operation, maintenance, and servicing of landscaping, street lighting, traffic signal improvements and related facilities and services in various areas throughout the City. Improvements currently provided within the District generally include but are not limited to: Local street lighting (residential street lighting associated with the properties within the Zone and specific subdivisions). Local landscaping improvements including parkways, perimeters, entryways, local medians, and internal landscaped amenities. Special Zone services including tree trimming, graffiti and weed abatement and landscape maintenance of flood control areas (retention and detention basins). District Zones of Benefit In accordance with the 1972 Act, the District utilizes Zones to address variations in the nature, location, and extent of the improvements that provide special benefits to parcels in the District. Within the boundaries of the District, parcels are assigned to benefit zones each of which is associated with a set of improvements and/or type of improvements that provide special benefit to properties within that Zone. As of fiscal year, 2017/2018 the District was comprised of the following benefit zones (Zones): Zone #2 Canyon Cove - Tracts 11636-1, 2, 3, & 4 and Tract 23485, generally located South of Deep Canyon Tennis Club, North of Haystack Road, West of Marrakesh Country Club, and East of Highway 74. Zone #3 Vineyards - Tracts 12181-1 and 12181-2 on the West side of Portola Avenue. The streets within the Zone include Martini Court, Heitz Court, Mondavi Court, Callaway Court, Stony Hill Court, Masson Street, Krug Avenue, Sebastian Way, and San Pasqual Avenue/Rutledge Way. Zone #4 Parkview Estates - Tract 8237, South of Magnesia Falls Drive, North of Fred Waring Drive, West of Deep Canyon Road, and East of Portola Avenue. Zone #5 Cook and Country Club consists of three (3) separate residential subdivisions identified as Sub-zones. These three Sub-zones are known and identified as: Sub-zones in Zone 5 Desert Mirase Tract 25639 Sandcastles Tract 21338-1 Tract 24603 Primrose II Tract 25436 Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 5 Zone #6 Hovley Lane located generally East of Monterey Avenue and West of Portola Avenue and includes parcels and tracts along Hovley Lane West. Zone 6 includes the following subdivisions and Sub-zones: Sub-zones in Zone 6 Monterey Meadows(Tracts 21791 and 22741) Hovley Collection(Tract 24603) Hovley Court West(Tract 29585) Hovley Glen(Tract 25217) La Paloma I(Tract 24773-1) Sandpiper West(Tract 29579) Hovley Estates(Tract 24591) La Paloma II(Tract 24773) Diamondback Road(Tract 29893) Sonata I(Tract 23982) La Paloma III(Tract 29045) Palm Court(Tract 25373) Sonata II(Tracts 24254-1,2,3) Sandpiper Court(Tract 27370) Zone 7 Waring Court consists of Tract 25304, North of Fred Waring Drive and East of Phyllis Jackson Lane. Zone 8 Palm Gate consists of the parcels in Tract 24287 located East of Deep Canyon Road, and North of Fred Waring Drive, on Coral Bells Circle, Daylily Circle, and Moss Rose Drive. Zone 9 The Grove consists of the parcels in Tract 24984 South of Goleta Avenue and West of Deep Canyon Road. Zone 11 Portola Place located South of Santa Rosa Way and East of Portola Avenue and consists of the parcels in Tract 27692. Zone 13 Palm Desert Country Club located generally South of Hovley Lane East, North of Fred Waring Drive, West of Warner Trail, and West of Washington and is commonly referred to as the Palm Desert Country Club area. Zone 14 K & B located generally North of Frank Sinatra Drive, West of Portola Avenue, East of Monterey Avenue and South of Gerald Ford Drive. The Zone includes the parcels in Tracts 28258 and 28258-1. Zone 15 Canyon Crest- Tract 25102-1 and 25102 generally located east of Deep Canyon Road, south of the Whitewater River Channel, north of Moss Rose Drive, and west of the Palm Desert High School. Zone #16 Shepard Lane consists of six (6) separate residential subdivisions identified as Sub- zones. These six Sub-zones are known and identified as: Sub-zones in Zone 16 College View Estates I(Tract 29444) College View Estates II(Tract 30087) Sundance West(Tract 30216) Sundance East(Tract 30503) Petunia I(Tract 30025) Boulders(Tract 30030)) Description of District Improvements As authorized by the 1972 Act, the improvements provided by the District and associated with each Zone incorporate various landscaping or lighting improvements that are maintained and serviced for the benefit of real property within the District. The maintenance of the landscape improvements may also incorporate various appurtenances that may include, but is not limited to entry monuments; various types of fencing; retaining walls; ornamental lighting or other ornamental fixtures; signage; and irrigation, drainage, and electrical equipment. In most cases, the various improvements associated with each Zone were either installed in direct connection with the development of properties within the Zone or were installed for the benefit of those properties as a result of property development or potential development of those properties and Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 6 were considered necessary for the development of those properties to their full and best use. The work to be performed within each respective Zone may include, but is not limited to (as applicable), the personnel, materials, equipment, electricity, water, contract services, repair and rehabilitation of the improvements and incidental expenses required to operate the District and provide the improvements and services for each Zone. Local Landscaping Zones The boundaries of each Local Landscaping Zone are established on the basis of the location, extent and types of improvements or similarities in the types of improvements being maintained through the District assessments as well as the particular and distinct benefits the various developments and properties derive from those improvements based on proximity to those specific improvements and the nexus between the development of the properties that required or facilitated the installation of those improvements. While most local landscape improvements are specifically associated with specific developments or development areas, some improvements (most typically greenbelts and/or trails) may be located between two or more Zones and/or extend from one Zone to the next and those improvements may reasonably be considered shared improvements. In such cases, the special benefits and cost of providing such improvements are proportionately shared by parcels in each Zone. Local Landscaping Zone 8 The following is a brief description and summary of the landscaped areas associated within Local Landscaping Zone 8. In connection with these landscaped areas, the maintenance of the improvements may also include various appurtenances such as monuments, fencing, retaining walls, ornamental lighting, signage, and related irrigation, drainage, and electrical equipment. The properties within Zone 8 receive benefit from the maintenance and operation of local street lighting at the entrances to the development at the corners of Deep Canyon Road and Coral Bells Circle, Daylily Circle, and Moss Rose Drive. These parcels also receive special benefit from the maintenance of the landscaped parkways adjacent to the development on Deep Canyon Road. Both the street lighting and landscape improvements identified for this Zone were installed as part of the residential development and the ongoing maintenance and operation of these improvements provide special benefit to properties within the Zone. It has been determined that these improvements were installed and are maintained solely for the benefit of properties within the Zone and provide no measurable benefit to properties outside the Zone or to the public at large. Therefore, both the interior tract street lighting and the parkway (perimeter) landscaping costs have been identified and apportioned 100% as a special benefit to the parcels within the Zone. Note: For fiscal Year 2018/2019, the City will loan the Zone $40,000 for renovation and repair cost that the property owners will repay over fifteen (15) years. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 7 PART II - METHOD OF APPORTIONMENT The 1972 Act permits the establishment of assessment districts by agencies for the purpose of providing certain public improvements, including the acquisition, construction, installation and servicing of landscape improvements and related facilities. The 1972 Act requires that the cost of these improvements be levied according to benefit rather than assessed value: Section 22573 defines the net amount to be assessed as follows: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefits to be received by each such lot or parcel from the improvements." Section 22574 provides for zones as follows: "The diagram and assessment may classify various areas within an assessment district into different zones where, by reason of variations in the nature, location, and extent of the improvements, the various areas will receive differing degrees of benefit from the improvements. A zone shall consist of all territory which will receive substantially the same degree of benefit from the improvements." The formulas used for calculating assessments and the designation of District Zones reflect the composition of parcels within the District and the improvements and activities to be provided, and have been designed to fairly apportion the cost of providing those improvements based on a determination of the proportional special benefits to each parcel, consistent with the requirements of the 1972 Act and the provisions of Proposition 218 and Article XIII D of the California Constitution. Proposition 218 Benefit Analysis The costs of the proposed improvements have been identified and allocated to properties within Zone 8 based on special benefit. The improvements provided and for which properties are to be assessed are local landscape improvements and related amenities that were installed in connection with the development of the properties and/or would otherwise be required for the development of properties within the Zone. The assessments and method of apportionment is based on the premise that these improvements would otherwise not have been required without the development of those parcels within Zone 8. Article XIII D Section 2i defines Special Benefit as follows: "Special benefit"means a particular and distinct benefit over and above general benefits conferred on real property located in the district or to the public at large. General enhancement of property value does not constitute "special benefit." Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 8 Article XIII D Section 4a defines proportional special benefit assessments as follows: "An agency which proposes to levy an assessment shall identify all parcels which will have a special benefit conferred upon them and upon which an assessment will be imposed. The proportionate special benefit derived by each identified parcel shall be determined in relationship to the entirety of the capital cost of a public improvement, the maintenance and operation expenses of a public improvement, or the cost of the property related service being provided. No assessment shall be imposed on any parcel which exceeds the reasonable cost of the proportional special benefit conferred on that parcel." Special Benefits The ongoing maintenance and servicing of the landscaped areas and appurtenant facilities within Local Landscaping Zone 8 provide aesthetic benefits to the properties within the Zone and a more pleasant environment to walk, drive, and live. The primary function of these landscape improvements and related amenities is to serve as an aesthetically pleasing enhancement and green space for the benefit of the immediately surrounding properties and developments for which the improvements were constructed and installed and/or were facilitated by the development of properties within the Zone. These improvements are an integral part of the physical environment associated with the parcels within the Zone and while some of these improvements may in part be visible to properties outside the Zone or in part proportionately shared with properties in adjacent Zones, collectively if these Zone improvements are not properly maintained, it is the parcels within Zone 8 that would be aesthetically burdened. The landscape improvements provided by the District may include landscaped medians, parkways, entryways, slopes and appurtenant facilities. Street lighting improvements may include energy costs and necessary maintenance to the facilities related thereto. The annual assessments outlined in this Report are proposed to cover the estimated costs to provide necessary service, operation, administration and maintenance required each year to keep these improvements in a healthy, vigorous and satisfactory condition. The special benefits associated with the local landscaping improvements are specifically: • Enhanced desirability of properties through association with the improvements. • Improved aesthetic appeal of properties within the Zones providing a positive representation of the area. • Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. • Environmental enhancement through improved erosion resistance, and dust and debris control. • Increased sense of pride in ownership of property within the District resulting from well- maintained improvements associated with the properties. • Reduced criminal activity and property-related crimes (especially vandalism) against properties in the District through well-maintained surroundings and amenities including abatement of graffiti. • Enhanced environmental quality of the parcels within the Zones by moderating temperatures, providing oxygenation and attenuating noise. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 9 The special benefits of street lighting are the convenience, safety and security of property, improvements and goods. Specifically: • Enhanced deterrence of crime and the aid to police protection. • Increased nighttime safety on roads and highways. • Improved ability of pedestrians and motorists to see. • Improved ingress and egress to property. • Reduced vandalism and other criminal acts and damage to improvements or property. • Improved traffic circulation and reduced nighttime accidents and personal property loss. • Increased promotion of business during nighttime hours in the case of commercial properties. General Benefit Prior to the passage of Proposition 218, some of the District assessments included maintenance of landscaped medians on various arterial streets within the City. However, since the maintenance of most arterial medians within the City were funded by the City's General Fund, it was determined that the existing assessments for these improvements were not a special benefit and in Fiscal Year 1997/98 the District assessments related to arterial medians were eliminated. In addition, any improvement and the associated costs that are considered a general benefit to properties outside the respective Zones or to the public at large have been identified and eliminated from the annual assessments. In making this determination it should be noted that parkway, perimeter landscaping and interior landscaping within the City is either funded or maintained by individual property owners or through some type of association, except those maintained and funded through a special District. The City does not usually maintain these types of improvements from General Fund Revenues and, like other similar improvements within the City, the ongoing maintenance of these improvements are a special benefit to the properties associated with the improvements. Assessment Methodology Pursuant to the 1972 Act, the costs of the District may be apportioned by any formula or method that fairly distributes the net amount to be assessed, among assessable parcels in proportion to the estimated benefits to be received by each such parcel from the improvements. The apportionment of costs used for each Zone should reflect the composition of the parcels, and the improvements and services provided based on each parcel's estimated special benefit. Equivalent Benefit Units: To assess benefits equitably, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit method of assessment apportionment uses the single-family home as the basic unit of assessment. A single-family home equals one Equivalent Benefit Unit (EBU). Every other land use is converted to EBUs based on an assessment formula that equates the property's specific development status, type of development (land use), and size of the property, as compared to a single-family home (SFR). The EBU method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type, size and development. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 10 Assessed parcels within Zones 2, 3, 4, 5, 6, 7, 8, 9, 11, 14, 15 and 16 are single-family residential parcels and the application of the EBU method of spread results in an equal assessment. Exempt parcels include easements and landscaped areas or common areas. The benefit formula applied to parcels in each Zone is based on the preceding Equivalent Benefit Unit (EBU) tables. Each parcel's EBU correlates the parcel's special benefit received as compared to the other parcels in the Zone. Parcel Type EBU x Acres or Units = Parcel EBU Total Balance to Levy in Zone/Total EBU in Zone =Levy per EBU Parcel EBU x Levy per EBU=Parcel Levy Amount Annual Inflationary Adjustment (Assessment Range Formula) Any new or increase in assessments, require certain noticing and meeting requirements by law. The Brown Act defines the terms "new or increased assessment" to exclude certain conditions. These certain conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition was later confirmed by Senate Bill 919 (the Proposition 218 implementing legislation). An assessment range formula for the District assessments has been confirmed through property owner ballot proceedings in compliance with Article XIIID, except those existing assessments within the District which qualified as exempt assessments pursuant to Article XIIID, Section 5 of the Constitution and did not require a ballot proceeding under the provisions of Section 4. The assessment range formula shall be applied to the future assessments within the District. The following describes this assessment range formula: Wherein, if the proposed assessment (levy per unit or rate) is less than or equal to, the prior year's maximum assessment plus the adjustments described in the following, then the proposed assessment is not considered an increased assessment. The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to the assessment amounts without requiring costly noticing and mailing procedures, which would be added to the District costs and assessments. If the proposed assessment is less than the maximum assessment approved in the previous fiscal year adjusted by a percentage no greater than three percent (3.0%), or the annual percentage increase of the Consumer Price Index (CPI), whichever is the lesser of the two, the assessment shall not be considered as an increase. Each year the City shall compute the percentage difference between the CPI on January 1, of each year and the CPI for the previous January 1, or a similar time period, as determined by the Bureau of Labor Statistics for all urban consumers for the Los Angeles, Anaheim and Riverside Area. This percentage difference shall then establish the range of increased assessments allowed based on CPI. Should the Bureau of Labor Statistics revise such index or discontinue Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 11 the preparation of such index, the City shall use the revised index or comparable system as approved by the City Council for determining fluctuations in the cost of living. If CPI is less than three percent (3.0%), then the allowable adjustment to the maximum assessment for each Zone may be by CPI. If CPI is greater than three percent (3.0%), then the allowable adjustment to the proposed assessment for each Zone may be three percent (3.0%). The fact that an assessment range formula is adopted for District assessments does not require that the adjustment be applied each year, nor does it restrict the assessments to the adjustment amount. If the budget and assessments for a given Zone do not require an increase or the increase is less than the allowable adjustment, then the required budget and assessment shall be applied. If the budget and assessments for a given Zone require an increase greater than the allowable adjustment then the proposed assessment is considered an increased assessment and mailed notices, as well as property owner protest ballots are required by Article XIIID to impose the assessment increase. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 12 PART III -PROPOSED ZONE BUDGET The following budget outlines the estimated costs to fully fund, maintain and service the various landscaping improvements and related amenities that provide special benefits to properties within Local Landscaping Zone 8 for fiscal year 2018/2019. In recent fiscal years, the total eligible special benefit expenses identified to adequately service and maintain the improvements for Local Landscaping Zone 8 have not been fully funded by the assessment revenues generated at the existing maximum assessment rate. As a result, it may have been necessary for City staff to reduce services and activities and/or reduce or eliminate the collection of funding for long term repairs, replacements and rehabilitation. Recognizing that these revenue shortfalls City staff met with a number of property owners and based on feedback received have decided to ballot for a new/increase assessment for fiscal year 2018/2019. The budget table identifies those estimated expenses and the resulting "Proposed Maximum Assessment Rate per EBU" for fiscal year 2018/2019 being presented to the property owners of record in a property owner protest ballot proceeding required pursuant to the provisions of the Constitution. CITY OF PALM DESERT ZONE 8 BUDGET MAINTENANCE&OPERATION EXPENSES Maintenance Costs $ 3,085 00 Landscape Utilities(Water/Electrical) 1,285.00 Tree Pruning 860.00 Street Lighting 555.00 Total Annual Direct Costs $ 5,785.00 INCIDENTAL/ADMINISTRATION EXPENSES District Administration $ 1,220.00 County Collection Fee 138.00 Total Incidental Costs $ 1,358.00 Total Maintenance,Operation &incidental Expenses $ 7,143.00 COLLECTIONS/(CREDITS)APPLIED TO LEVY General Benefit Contribution $ - Capital Improvement/Loan 2,667.00 Reserve Fund 1,290.00 Additional City Contribution - Total Contribution/Credit $ 3,957.00 Balance to Levy(Budgeted) $ 11,100,00 DISTRICT STATISTICS Total Parcels 37 Total Parcels Levied 37 Total Equivalent Benefit Units 37.00 Proposed Levy per Benefit Unit $ 300.00 Calculated Levy per Benefit Unit $ 300.00 Maximum Levy per Benefit Unit(FY2018/2019) $ 300.00 Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 13 PART IV - ASSESSMENT ROLL The Assessment Roll containing the proposed new/increased maximum assessment for fiscal year 2018/2019 is identified on the following page. The Assessment Roll incorporates each parcel identified within Local Landscaping Zone 8 and the balloted maximum assessment amount proposed for fiscal year 2018/2019. Each parcel listed on the Assessment Roll is currently shown and illustrated on the County Assessor's Roll and the County Assessor's Parcel Number Maps (APN maps). These records are, by reference, made part of this Report and shall govern for all details concerning the description of the lots or parcels. All assessments presented on the assessment roll are subject to change pending the outcome of the Ballot Proceedings and/or as a result of parcel changes made by the County including parcel splits, parcel merges or development changes that occur prior to the County Assessor's Office securing the final roll and generating tax bills for fiscal year 2018/2019. Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 14 Assessor's Maximum Proposed Proposed Parcel Designated Assessment EDUs Assessment Maximum Number Land Use per EDU Assessment Fiscal Year 2018/2019 624-352-001 RES 1 $300.00 $300.00 $300.00 624-352-002 RES 1 $300.00 $300.00 $300.00 624-352-003 RES 1 $300.00 $300.00 $300.00 624-352-004 RES 1 $300.00 $300.00 $300.00 624-352-005 RES 1 $300.00 $300.00 $300.00 624-352-006 RES 1 $300.00 $300.00 $300.00 624-352-007 RES 1 $300.00 $300.00 $300.00 624-352-008 RES 1 $300.00 $300.00 $300.00 624-352-009 RES 1 $300.00 $300.00 $300.00 624-352-010 RES 1 $300.00 $300.00 $300.00 624-352-011 RES 1 $300.00 $300.00 $300.00 624-352-012 RES 1 $300.00 $300.00 $300.00 624-352-013 RES 1 $300.00 $300.00 $300.00 624-352-014 RES 1 $300.00 $300.00 $300.00 624-352-015 RES 1 $300.00 $300.00 $300.00 624-352-016 RES 1 $300.00 $300.00 $300.00 624-352-017 RES 1 $300.00 $300.00 $300.00 624-352-018 RES 1 $300.00 $300.00 $300.00 624-352-019 RES 1 $300.00 $300.00 $300.00 624-352-020 RES 1 $300.00 $300.00 $300.00 624-352-021 RES 1 $300.00 $300.00 $300.00 624-352-022 RES 1 $300.00 $300.00 $300.00 624-352-023 RES 1 $300.00 $300.00 $300.00 624-352-024 RES 1 $300.00 $300.00 $300.00 624-352-025 RES 1 $300.00 $300.00 $300.00 624-352-026 RES 1 $300.00 $300.00 $300.00 624-352-027 RES 1 $300.00 $300.00 $300.00 624-352-028 RES 1 $300.00 $300.00 $300.00 624-352-029 RES 1 $300.00 $300.00 $300.00 624-352-030 RES 1 $300.00 $300.00 $300.00 624-352-031 RES 1 $300.00 $300.00 $300.00 624-352-032 RES 1 $300.00 $300.00 $300.00 624-352-033 RES 1 $300.00 $300.00 $300.00 624-352-034 RES 1 $300.00 $300.00 $300.00 624-352-035 RES 1 $300.00 $300.00 $300.00 624-352-036 RES 1 $300.00 $300.00 $300.00 624-352-037 RES 1 $300.00 $300.00 $300.00 Zone Total 37 $11,100.00 $11,100.00 Palm Desert LLD No.1 Balloting Engineer's Report,Zone 8 Page 15 PART V - ZONE DIAGRAM The following Boundary Map Diagram incorporates the lots and parcels of land within Zone 8 of Palm Desert Landscaping and Lighting District No. 1 for Fiscal Year 2017/2018, as the same existed at the time this Report was prepared. 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